[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 491 Introduced in House (IH)]







106th CONGRESS
  1st Session
                                H. R. 491

  To amend parts C and D of title XVIII of the Social Security Act to 
   improve the operation of the Medicare+Choice and Medigap programs.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 2, 1999

 Mr. Stark (for himself, Mr. Brown of Ohio, Mrs. Thurman, Mr. Waxman, 
Mr. Lewis of Georgia, Mr. McDermott, Mr. Levin, Mr. Matsui, Mr. Neal of 
 Massachusetts, Mr. Frank of Massachusetts, Mr. Moran of Virginia, Mr. 
 Frost, Mr. Markey, and Ms. Schakowsky) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addition 
     to the Committee on Commerce, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
  To amend parts C and D of title XVIII of the Social Security Act to 
   improve the operation of the Medicare+Choice and Medigap programs.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECURITY ACT; TABLE OF 
              CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Medicare+Choice 
Program Improvement Act of 1999''.
    (b) Amendments to Social Security Act.--Except as otherwise 
specifically provided, whenever in this Act an amendment is expressed 
in terms of an amendment to or repeal of a section or other provision, 
the reference shall be considered to be made to that section or other 
provision of the Social Security Act.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; amendments to Social Security Act; table of 
                            contents.
Sec. 2. Enrollment of medicare beneficiaries in alternative 
                            Medicare+Choice plans and Medigap coverage 
                            in case of involuntary termination of 
                            Medicare+Choice enrollment.
Sec. 3. Applying Medigap and Medicare+Choice protections to disabled 
                            and ESRD medicare beneficiaries.
Sec. 4. Prohibition of attained-age rating of premiums for Medigap 
                            policies.
Sec. 5. Non-preemption of State prescription drug coverage mandates in 
                            case of approved State Medigap waivers.
Sec. 6. Prohibition of cold-call marketing of Medicare+Choice plans.
Sec. 7. Flexibility in definition of service area under the 
                            Medicare+Choice program.
Sec. 8. 3-year phase-in of risk adjustment of Medicare+Choice plan 
                            payments.
Sec. 9. Delay in certain deadlines under the Medicare+Choice program.
Sec. 10. Taking into account costs of VA and DOD military facility 
                            services to medicare-eligible beneficiaries 
                            in calculation of Medicare+Choice plan 
                            payment rates.
Sec. 11. Increase in civil monetary penalties for failure to meet 
                            Medigap open enrollment requirements.
Sec. 12. NAIC review and update of benefit packages for Medigap 
                            policies.

SEC. 2. ENROLLMENT OF MEDICARE BENEFICIARIES IN ALTERNATIVE 
              MEDICARE+CHOICE PLANS AND MEDIGAP COVERAGE IN CASE OF 
              INVOLUNTARY TERMINATION OF MEDICARE+CHOICE ENROLLMENT.

    (a) Permitting Enrollment in Alternative Plans Upon Receipt of 
Notice of Medicare+Choice Plan Termination.--
            (1) Enrollment in alternative medicare+choice plans.--
        Section 1851(e)(4) (42 U.S.C. 1395w-21(e)(4)) is amended--
                    (A) in subparagraph (A), by inserting before the 
                semicolon at the end the following: ``or the 
                organization or plan, respectively, has provided notice 
                to the individual of the impending termination (or 
                termination or discontinuation, respectively)''; and
                    (B) by adding at the end the following: ``In the 
                case described in subparagraph (A), the right to make a 
                new election under this paragraph shall extend through 
                the end of the next annual, coordinated election 
                period.''.
            (2) Medigap plans.--Section 1882(s)(3)(A) (42 U.S.C. 
        1395ss(s)(3)(A)) is amended, in the matter following clause 
        (iii)--
                    (A) by inserting ``(or, if elected by the 
                individual, the date of notification of the individual 
                by the plan or organization of the impending 
                termination or discontinuance of the plan in the area 
                in which the individual resides)'' after ``the date of 
                the termination of enrollment described in such 
                subparagraph'';
                    (B) by inserting ``(or date of such notification, 
                respectively)'' after ``the date of termination or 
                disenrollment''; and
                    (C) by inserting after ``63 days'' the following: 
                ``(or 92 days in the case of a termination or 
                discontinuation of coverage under the types of 
                circumstances described in section 1851(e)(4)(A))''.
            (3) Effective date.--The amendments made by this subsection 
        apply to notices of intended termination made by group health 
        plans and Medicare+Choice organizations after the date of the 
        enactment of this Act.
    (b) Guaranteed Access for Certain Medicare Beneficiaries to Medigap 
Policies in Case of Involuntary Termination of Coverage Under a 
Medicare+Choice Plan.--
            (1) In general.--Section 1882(s)(3)(C)(iii) (42 U.S.C. 
        1395ss(s)(3)(C)(iii)) is amended by inserting ``or an 
        individual described in subparagraph (B)(ii) or (B)(iii) in the 
        case of circumstances described in section 1851(e)(4)(A)'' 
        after ``subparagraph (B)(vi)''.
            (2) Effective date.--
                    (A) In general.--Subject to subparagraph (B), the 
                amendment made by paragraph (1) applies to terminations 
                of coverage effected on or after the date of the 
                enactment of this Act.
                    (B) Transitional medigap open enrollment period for 
                certain individuals affected by plan withdrawals during 
                1998.--In the case of an individual described in 
                subparagraph (B)(ii) or (B)(iii) of section 1882(s)(3) 
                of the Social Security Act in the case of circumstances 
                described in section 1851(e)(4)(A) of such Act 
                (relating to discontinuation of a plan or organization 
                entirely or in an area), if the termination or 
                discontinuation of coverage occurred as of the end of 
                1998, and before the date of the enactment of this Act, 
                the provisions of subparagraph (A) of section 
                1882(s)(3) such Act (in the matter up to and including 
                clause (iii) thereof) shall apply to such an individual 
                who seeks enrollment under a medicare supplemental 
                policy during the 92-day period beginning with the 
                first month that begins more than 30 days after the 
                date of the enactment of this Act in the same manner as 
                such provisions apply to an individual described in the 
                matter following such clause (iii).

SEC. 3. APPLYING MEDIGAP AND MEDICARE+CHOICE PROTECTIONS TO DISABLED 
              AND ESRD MEDICARE BENEFICIARIES.

    (a) Assuring Availability of Medigap Coverage.--
            (1) In general.--Section 1882(s) (42 U.S.C. 1395ss(s)) is 
        amended--
                    (A) in paragraph (2)(A), by striking ``is 65 years 
                of age or older and is'' and inserting ``is first'';
                    (B) in paragraph (2)(D), by striking ``who is 65 
                years of age or older as of the date of issuance and''; 
                and
                    (C) paragraph (3)(B)(vi), by striking ``at age 
                65''.
            (2) Effective date.--The amendments made by paragraph (1) 
        apply terminations of coverage effected on or after the date of 
        the enactment of this Act, regardless of when the individuals 
        become eligible for benefits under part A or part B of title 
        XVIII of the Social Security Act.
    (b) Permitting ESRD Beneficiaries To Elect Another Medicare+Choice 
Plan in Case of Plan Discontinuance.--
            (1) In general.--Section 1851(a)(3)(B) (42 U.S.C. 1395w-
        21(a)(3)(B)) is amended by striking ``except that'' and all 
        that follows and inserting the following: ``except that--
                            ``(i) an individual who develops end-stage 
                        renal disease while enrolled in a 
                        Medicare+Choice plan may continue to be 
                        enrolled in that plan; and
                            ``(ii) in the case of such an individual 
                        who is enrolled in a Medicare+Choice plan under 
                        clause (i) (or subsequently under this clause), 
                        if the enrollment is discontinued under section 
                        1851(e)(4)(A) the individual will be treated as 
                        a `Medicare+Choice eligible individual' for 
                        purposes of electing to continue enrollment in 
                        another Medicare+Choice plan.''.
            (2) Effective date.--(A) The amendment made by paragraph 
        (1) applies to terminations and discontinuations occurring on 
        or after the date of the enactment of this Act.
    (B) Clause (ii) of section 1851(a)(3)(B) of the Social Security Act 
(as inserted by such amendment) also shall apply to individuals whose 
enrollment in a Medicare+Choice plan was terminated or discontinued as 
of the end of 1998. In applying this subparagraph, such an individual 
shall be treated, for purposes of part C of title XVIII of the Social 
Security Act, as having discontinued enrollment in such a plan as of 
the date of the enactment of this Act.

SEC. 4. PROHIBITION OF ATTAINED-AGE RATING OF PREMIUMS FOR MEDIGAP 
              POLICIES.

    Section 1882 (42 U.S.C. 1395ss) is amended by adding at the end the 
following new subsection:
    ``(v)(1) A medicare supplemental policy may not be issued or 
renewed (or otherwise provide coverage after the deadline established 
under paragraph (2)) in any State unless the premiums for the policy do 
not increase for an individual under the policy based on the aging of 
the individual.
    ``(2) The requirement of paragraph (1) shall apply to premiums for 
policies under a timetable, recognized by the Secretary, that provides 
for an appropriate phase-in of such requirement. The Secretary shall 
recognize as the timetable such timetable as the National Association 
of Insurance Commissioners may recommend to the Secretary within 9 
months after the date of the enactment of this subsection.''.

SEC. 5. NON-PREEMPTION OF STATE PRESCRIPTION DRUG COVERAGE MANDATES IN 
              CASE OF APPROVED STATE MEDIGAP WAIVERS.

    (a) In General.--Section 1856(b)(3) (42 U.S.C. 1395w-26(b)(3)) is 
amended--
            (1) in subparagraph (A), by striking ``The standards'' and 
        inserting ``Subject to subparagraph (C), the standards'', and
            (2) by adding at the end the following new subparagraph:
                    ``(C) Continuation of state prescription drug 
                laws.--Subparagraph (A) shall not supersede any State 
                law that requires the comprehensive coverage of 
                prescription drugs or any regulation that carries out 
                such a law, if--
                            ``(i) the State has a waiver in effect 
                        under section 1882(p)(6)(A) with respect to 
                        requiring such coverage under medicare 
                        supplemental policies; or
                            ``(ii) the Secretary provides for a waiver 
                        for the State to impose such a requirement 
                        under section 1882(p)(6)(B).''.
    (b) Medigap Waiver.--Section 1882(p)(6) (42 U.S.C. 1395ss(p)(6)) is 
amended--
            (1) by inserting ``(A)'' after ``(6)'', and
            (2) by adding at the end the following new subparagraph:
    ``(B) The Secretary also may waive the application of the standards 
described in paragraph (1)(A)(i) for a State to include comprehensive 
prescription drug coverage among the benefits required for all medicare 
supplemental policies.''.
    (c) Effective Date.--The amendments made by this section take 
effect on the date of the enactment of this Act.

SEC. 6. PROHIBITION OF COLD-CALL MARKETING OF MEDICARE+CHOICE PLANS.

    (a) In General.--Section 1851(h)(4) (42 U.S.C. 1395w-21(h)(4)) is 
amended--
            (1) by striking ``and'' at the end of subparagraph (A),
            (2) by striking the period at the end of subparagraph (B) 
        and inserting ``; and'', and
            (3) by adding at the end the following new subparagraph:
                    ``(C) shall include a prohibition against, directly 
                or indirectly, conducting door-to-door, telephonic, or 
                other `cold-call' marketing of enrollment under this 
                part.''.
    (b) Effective Date.--The amendments made by subsection (a) apply to 
marketing of enrollment conducted on or after the date of the enactment 
of this Act.

SEC. 7. FLEXIBILITY IN DEFINITION OF SERVICE AREA UNDER THE 
              MEDICARE+CHOICE PROGRAM.

    (a) In General.--Section 1854(a) (42 U.S.C. 1395w-24(a)) is amended 
by adding at the end the following new paragraph:
            ``(6) Special rules for service areas.--
                    ``(A) In general.--For purposes of this subsection, 
                except as provided in this paragraph, the term `service 
                area' means, for a Medicare+Choice organization that--
                            ``(i) offers commercial health insurance 
                        coverage, that portion of the area identical to 
                        the service area used for purposes of offering 
                        such commercial coverage; or
                            ``(ii) is a provider-sponsored organization 
                        that receives a Federal waiver of certain 
                        requirements under section 1855(a)(2) and does 
                        not offer commercial health insurance coverage, 
                        such area proposed by the organization and 
                        approved by the Secretary.
                    ``(B) Limitation on service area.--In no case shall 
                a service area for an organization include any area in 
                which the organization is unable to provide benefits 
                consistent with the requirements of section 1852(d).
                    ``(C) Transition for current contractors.--In the 
                case of a Medicare+Choice organization that has in 
                effect a contract under this part with the Secretary as 
                of January 1, 1999, subparagraph (A) shall not apply to 
                a contract year that begins before January 1, 2004, if 
                the organization provides evidence that it has not (on 
                or after January 1, 1999) eliminated, from the service 
                area under this part, any area in which the 
                organization continues to offer commercial health 
                insurance coverage.
                    ``(D) Permitting use of separate commercial rating 
                areas.--
                            ``(i) In general.--If a Medicare+Choice 
                        organization offers commercial health insurance 
                        coverage and has multiple geographic areas with 
                        separate premium rates, subject to clause (ii), 
                        each of those commercial geographic rating 
                        areas may, at the option of the organization, 
                        be treated as a separate service area.
                            ``(ii) Limitation on size.--Unless 
                        otherwise approved by the Secretary, in no case 
                        shall a commercial geographic rating area that 
                        includes less than an entire county (or 
                        equivalent area) be treated as a separate 
                        service area.''.
    (b) Effective Date.--The amendment made by subsection (a) applies 
to contract years beginning on or after January 1, 2000.

SEC. 8. 3-YEAR PHASE-IN OF RISK ADJUSTMENT OF MEDICARE+CHOICE PLAN 
              PAYMENTS.

    Section 1853(a)(3)(C) (42 U.S.C. 1395w-23(a)(3)(C)) is amended by 
adding at the end the following: ``Such risk adjustment methodology 
shall be implemented in a phased-in manner over a 3-year period.''.

SEC. 9. DELAY IN CERTAIN DEADLINES UNDER THE MEDICARE+CHOICE PROGRAM.

    (a) Delay in Rate Promulgation Deadline.--Section 1853(b)(1) (42 
U.S.C. 1395w-23(b)(1)) is amended by striking ``March 1'' and inserting 
``May 1''.
    (b) Delay in Deadline for Submission of Adjusted Community Rates 
and Related Information.--
            (1) In general.--Section 1854(a)(1) (42 U.S.C. 1395w-
        24(a)(1)) is amended by striking ``May 1'' and inserting ``July 
        1''.
            (2) Adjustment in information disclosure provisions.--
        Section 1851(d)(2)(A)(ii) (42 U.S.C. 1395w-21(d)(2)(A)(ii)) is 
        amended by inserting after ``information described in paragraph 
        (4) concerning such plans'' the following: ``, to the extent 
        such information is available at the time of preparation of the 
        material for mailing''.
    (c) Delay in Deadline for Gubernatorial Requests for Changes in 
Payment Areas.--Section 1853(d)(3) (42 U.S.C. 1395w-23(d)(3)) is 
amended by striking ``February 1'' and inserting ``March 1''.

SEC. 10. TAKING INTO ACCOUNT COSTS OF VA AND DOD MILITARY FACILITY 
              SERVICES TO MEDICARE-ELIGIBLE BENEFICIARIES IN 
              CALCULATION OF MEDICARE+CHOICE PLAN PAYMENT RATES.

    (a) In General.--Section 1853(c)(3) (42 U.S.C. 1395w-23(c)(3)) is 
amended--
            (1) in subparagraph (A), by striking ``subparagraph (B)'' 
        and inserting ``subparagraphs (B) and (E)'', and
            (2) by adding at the end the following new subparagraph:
                    ``(E) Inclusion of costs of va and dod military 
                facility services to medicare-eligible beneficiaries.--
                In determining the area-specific Medicare+Choice 
                capitation rate under subparagraph (A) for a year 
                (beginning with 2000), the annual per capita rate of 
                payment for 1997 determined under section 1876(a)(1)(C) 
                shall be adjusted to include in the rate the 
                Secretary's best estimate on a per capita basis of the 
                amount of additional payments that would have been made 
                in the area involved under this title if beneficiaries 
                under this title had not received services from 
                facilities of the Department of Veterans Affairs or the 
                Department of Defense.''.
    (b) Budget Neutrality.--Section 1853(c) (42 U.S.C. 1395w-23(c)) is 
amended--
            (1) in paragraph (1)(A), by striking ``paragraph (5)'' and 
        inserting ``paragraph (5)(A)'';
            (2) in paragraph (1)(C)(ii), by inserting before the period 
        at the end the following: ``and multiplied by the budget 
        neutrality adjustment factor determined under paragraph 
        (5)(B)''; and
            (3) in paragraph (5)--
                    (A) by striking ``factor.--'' and inserting 
                ``factors.--(A)'',
                    (B) by inserting ``(not taking into account 
                subparagraph (B))'' after ``so that'', and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(B) For purposes of paragraph (1)(C)(ii), for 
                each year, the Secretary shall determine a budget 
                neutrality adjustment factor so that the aggregate of 
                the payments under this part shall equal the aggregate 
                payments that would have been made under this part if 
                paragraph (3)(E) did not apply.''.

SEC. 11. INCREASE IN CIVIL MONETARY PENALTIES FOR FAILURE TO MEET 
              MEDIGAP OPEN ENROLLMENT REQUIREMENTS.

    (a) In General.--Section 1882(s)(4) (42 U.S.C. 1395ss(s)(4)) is 
amended by striking ``$5,000'' and inserting ``$50,000''.
    (b) Effective Date.--The amendment made by subsection (a) applies 
to failures occurring on or after the date of the enactment of this 
Act.

SEC. 12. NAIC REVIEW AND UPDATE OF BENEFIT PACKAGES FOR MEDIGAP 
              POLICIES.

    Section 1882(p) (42 U.S.C. 1395ss(p)) is amended--
            (1) in paragraph (2), by striking ``The benefits'' and 
        inserting ``Subject to paragraph (12), the benefits''; and
            (2) by adding at the end the following new paragraph:
    ``(12)(A) The Secretary may request the National Association of 
Insurance Commissioners to review the appropriateness of the benefit 
packages established under paragraph (2) and, if appropriate, to 
recommend to the Secretary from time to time recommendations for 
changes in such packages to better reflect the needs of beneficiaries 
and modern medical practice.
    ``(B) If a recommendation for a change in benefit packages is 
recommended under subparagraph (A) and the Secretary finds that 
implementation of such recommendation is appropriate and consistent 
with carrying out the purposes of this section, the Secretary may 
provide that any reference in this subsection to the 1991 NAIC Model 
Regulation is deemed a reference to such Regulation as modified by the 
proposed recommendation. Any such change shall take effect as specified 
by the Secretary in such a manner as does not unduly disrupt the 
marketing of medicare supplemental policies.
    ``(C) Before implementing any recommendation under subparagraph 
(B), the Secretary shall submit a report to Congress on such 
recommendation, including a justification for the implementation of 
such recommendation.''.
                                 <all>